You Own 100 Shares of Stock That Are Earning $2

Multiple Choice

You own 100 shares of stock that are earning $2 per share per year. According to market analysts, the stock is expected to continue to earn $2 long into the future. Using the annuity rule, and assuming an interest rate of 6.5 percent, it follows that the present value of these 100 shares is:

A) $30.77.
B) $307.79.
C) $3,076.92.
D) $30,076.92.